Market watch: Bears pull stocks down ahead of MPC meeting

Benchmark KSE-100 index declines 94.37 points to settle at 44,923.91

KARACHI:

The Pakistan Stock Exchange endured a tumultuous session on Monday and the benchmark KSE-100 index recorded multiple ups and downs as investors awaited the announcement of monetary policy statement after the market’s close.

Bears managed to overpower bulls as the bourse finally closed with a loss of 94 points.

Cautious investors opted to stay on the sidelines ahead of the policy rate announcement, while a number of negative indicators including the surging current account deficit and the depreciating rupee prevented them from taking fresh positions.

Moreover, swelling energy and commodity prices in the international market continued to pile on pressure on the market participants.

In early trading at the bourse, the KSE-100 index registered a steep fall as jittery investors resorted to profit-taking owing to the negative triggers. However, bulls managed to wipe off some of the losses soon after.

Later, bears and bulls locked horns with the index showing minor ups and downs throughout the day.

Before the close of market, bears managed to win the battle, pushing the index into negative territory.

At close, the benchmark KSE-100 index recorded a decrease of 94.37 points, or 0.21%, to settle at 44,923.91.

Arif Habib Limited, in its report, stated that a range-bound session was witnessed at the bourse ahead of the Monetary Policy Committee (MPC) meeting. Main board activity remained gloomy on the first day of rollover week.

On the flip side, the market continued to trade sideways as it witnessed hefty volumes in third-tier stocks. In the last trading hour, value buying was observed due to the announcement of corporate results, the report said.

Sectors contributing to the performance included technology (-72 points), cement (-25 points), commercial banks (-18 points), engineering (-9 points) and investment banks (-7 points).

JS Global analyst Muhammad Mubashir said that range-bound activity continued at the bourse due to the lack of positive triggers amid Covid-19’s fifth wave.

Cnergyico Pk (-3%), TRG Pakistan (-4.7%), Hascol Petroleum (-9.6%), WorldCall Telecom (-0.5%) and Hum Network (+0.7%) accounted for 47% of the aggregate volumes.

“Going forward, we expect that news regarding the resumption of IMF programme will improve volumes and market sentiment,” the analyst said, adding “we recommend investors to avail any downside as an opportunity to buy in technology, cement and textile sectors”.

Overall trading volumes dropped to 160.2 million shares compared with Friday’s tally of 176.1 million. The value of shares traded during the day was Rs5.7 billion.

Shares of 325 companies were traded. At the end of the day, 96 stocks closed higher, 214 declined and 15 remained unchanged.

Cnergyico Pk was the volume leader with 25.5 million shares, losing Rs0.19 to close at Rs6.18. It was followed by TRG Pakistan with 21.1 million shares, losing Rs4.01 to close at Rs80.89 and Hascol Petroleum with 11.8 million shares, losing Rs0.64 to close at Rs6.03.

Foreign institutional investors were net sellers of Rs26.88 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan